Reorganization Drags Unr Industries Down

August 05, 1986

UNR Industries Inc.`s earnings from continuing operations fell 46 percent in the second quarter, weighted down by heavier costs related to its reorganization under Chapter 11 of the U.S. bankruptcy code and by interest expenses.

In the quarter, net income from continuing operations was $558,023, or 15 cents a share, down from $1 million, or 28 cents a share, in the year-earlier period. Revenues rose 6 percent, to $78.7 million from $74.1 million.

The company`s reorganization plan was filed with the U.S. Bankruptcy Court here this June but hasn`t yet been approved by creditors or the court.

Reorganization-related costs rose in the latest period to $1.4 million from $1.1 million a year earlier. UNR also had net interest expense of $32,600 in the latest quarter, in contrast to net interest income of $133,400 a year earlier.

UNR said it plans to divest its appliance distribution division, which is based in West Virginia and whose results were reclassified as discontinued operations. UNR said no significant gain or loss is expected on the divestiture.

A loss of $109,856 from discontinued operations brought final net income to $448,167, or 12 cents a share, in the 1986 second period.

The 1985 period included a loss from discontinued operations of $186,798 and a $5 million addition to divestiture loss reserves, resulting in a net loss of $4.15 million.